The 2009 balance sheet and income statement for the Woods Company are shown here: Woods Company: Balance Sheet as of December 31, 2009 ($ thousands) Cash $ 80 Accounts payable Accounts receivable 240 Accruals $ 160 40 Inventories 720 Notes payable 252 Current assets $1,040 Current liabilities $ 452 Fixed assets 3,200 Long-term debt 1,244 Common stock 1,605 Retained earnings 939 Total assets $4.240 Total liabilities and equity $4.240 Woods Company: Income Statement for the Year Ending December 31, 2009 ($ thousands) Sales Operating costs $ 8,000 (7,450) $ 550 (150) $ 400 (160) $ 240 Earnings before interest and taxes Interest Earnings before taxes Taxes (40%) Net income Per-Share Data Common stock price Earnings per share (EPS) Dividends per share (DPS) .com $ 16.96 $ 1.60 $ 1.04 a. The firm operated at full capacity in 2009. It expects sales to increase by 20 percent during 2010 and expects 2010 dividends per share to increase to $1.10. Use the projected balance sheet method to determine how much outside financing is required, developing the firm's pro forma balance sheet and income statement, and use AFN as the balancing item. b. If the firm must maintain a current ratio of 2.3 and a debt ratio of 40 percent, how much financing, after the first pass, will be obtained using notes payable, long-term debt, and common stock? c. Construct the second-pass financial statements incorporating financing feedbacks, using the ratios in part b. Assume that the interest rate on debt averages 10 percent.